Rafiquennessa Vs. Lal Bahadur Chetri
 INSC 43 (24 February 1964)
24/02/1964 GAJENDRAGADKAR, P.B. (CJ)
GAJENDRAGADKAR, P.B. (CJ) WANCHOO, K.N.
AYYANGAR, N. RAJAGOPALA SIKRI, S.M.
CITATION: 1964 AIR 1511 1964 SCR (6) 876
RF 1966 SC1908 (3) F 1985 SC 111 (8) RF 1991
Retroactivity-Enactment of the Act pending
appeal-Appeal if governed by the Act-Assam Non-Agricultural Urban Areas Tenancy
Act. 1955 (Assam Act No. 12 of 1955), s. 5.
The appellant sued the lessee, the
predecessor of the respondents, for ejectment on the latter's failure to
deliver possession of a leased land at the expiration of the stipulated period.
Under the covenant the lessee was entitled to build a house for residential purposes.
The trial Court decreed the appellant's claim whereupon the lessee filed an
appeal. While the appeal was pending the Assam Non-Agricultural Urban Areas
Tenancy Act was passed, and thereafter the lessee prayed for permission to take
an additional ground under s. 5 of the Act. Before that date, the High Court
had taken the view that this provision of the Act was applicable to pending
proceedings. The lower appellate court allowed the lessee's plea and ultimately
allowed the appeal and set aside -,he decree passed by the trial Judge in
favour of the appellant, concluding that the two houses had been constructed by
the lessee within five years after the taking of the lease and that entitled
the lessee to claim the benefit of s. 5 of the Act. The High Court on appeal,
following its earlier decision about the applicability of the provisions of s.
5 to pending proceedings, summarily dismissed the appeal, but granted a
certificate for leave to appeal to this Court Held: (i) A statutory provision
is retroactive either when it is so declared by express terms. or the intention
to make it retroactive clearly follows from the relevant words and the context
in which they occur Re. Athlumney Ex parte Wilson, (1898) 2 Q.B.D. 547,
(ii) The provisions of the Act clearly
indicate that the legislature wanted the beneficient provisions enacted by it
to take within their protection not only leases executed after the Act came
into force, but also leases executed prior to the operation of the Act.
The plain object of s.5 is to protect the
tenants who have built a permanent structure either for business or for
residence, provided it has been built within 5 years from the date of contract
of tenancy, even though those constructions had been made before the date of
(iii) A suit which was pending when the Act
came into force would be governed by s. 5(1) (a) and an appeal arising from a
suit which had been decided before the Act came into force, would likewise be
governed by s. 5(1) (a), provided it is pending after the date when the Act
came into force. for an appeal pending in a continuation of the suit.
CIVIL APPELLATE JURISDICTION: CIVIL Appeal
No. 549 of 1962.
Appeals from the judgment and orders dated
August 1, 1958 and March 13, 1959 of the Assam High Court A. Nos. 86 of 1958
and 14 of 1959 respectively.
N. C. Chatterjee, K. P. Sen and P. K.
Chatterjee, for the appellant (in C.A. No. 549 of 1962).
878 B. P. Maheshwari, for respondents Nos.
1(a) to 1(e) (in C.A. No. 549 of 1962).
Behrul Islam and R. Gopalakrishnan, for the
appellant (in C.A. No. 569 of 1963).
D. N. Mukherjee, for the respondent (in C.A.
No. 569/ 63).
February 24, 1964. The Judgment of the Court
was delivered by GAJENDRAGADKAR C.J.-These two appeals which have been brought
to this Court with a certificate issued by the Assam High Court, raise a short
question about the construction and effect of section 5 of the Assam
NonAgricultural Urban Area Tenancy Act, 1955 (No. 12 of 1955) (hereinafter
called 'the Act'). The relevant and material facts which have led to the suits
from which these two appeals respectively arise, are similar, and so, it would
not be necessary to state them in detail in regard to both the matters. We
would, therefore, mention the facts broadly in C.A. No.
549/1962, in dealing with the common point
raised for our decision. The appellant in this case is Mst. Rafiquennessa who
sued the predecessor of the respondents for ejectment.
It appears that Lal Bahadur Chetri has
executed a registered lease-deed in favour of the appellant on the 14th
February, 1946. The lease covered an open plot of land and under the covenant
the leasee was entitled to build a house for residential purposes. In the
ordinary course, the lease was due to expire on the 12th February, 1952, and the
lessee had agreed to deliver vacant possession of the land at the expiration of
the stipulated period. Accordingly, a notice to quit was served on him to
vacate on the 12th February, 1952. He, however, did not comply with the notice
and that led to the present suit by the appellant for eviction (No.
149 of 1952). In support of her claim, the
appellant alleged that the lessee had contravened the terms of the lease
inasmuch as he had sublet the premises built by him, and so, that was an
additional ground for evicting the lessee. The sub-lessees were accordingly
joined as defendants to the suit.
The lessee Chetri alone resisted the suit.
The sub-tenants let into possession by him did not join issue with the appel879
lant. The trial Judge decreed the appellant's claim whereupon the lessee Chetri
filed an appeal in the Court of the Sub-Judge, Lower Assam District, Gauhati,
challenging the validity and the correctness of the decree passed against him
(Civil Appeal No. 24/1953).
While the appeal was pending, the Act was
passed and was published in the Assam Gazette on the 6th July, 1955.
Thereafter, when the appeal came on for
hearing before the lower appellate Court, the tenant filed an application
praying that he should be permitted to take an additional ground under s. 5 of
the Act. Before that date, the Assam High Court had taken the view that the
said provision of the Act was applicable to the pending proceedings between
landlords and tenants for eviction and that was the basis on which the tenant
Chetri wanted to support his appeal. The lower appellate Court allowed the
tenant's plea, framed an additional issue in pursuance of it and sent the
matter back to the trial Court for a finding.
On remand, the trial Court took evidence and
after local inspection, made a finding that the two houses proved to have been
built by the tenant must be regarded as permanent in relation to the locality
of the plot. He, however, found that there was no evidence to show when the
said houses were constructed. Part of the finding was challenged by the tenant
before the lower appellate Court. The lower appellate Court ultimately allowed
the appeal and set aside the decree passed by the trial Judge in favour of the
The conclusion of the lower appellate Court
was that the two houses had been constructed by the tenant within five years
after the taking of the lease and that entitled the lessee to claim the benefit
of s. 5 of the Act.
The appellant then preferred a second appeal
in the High Court of Assam (No. 86/1958). Following its earlier decision about
the applicability of the provisions of s. 5 to pending proceedings, the High
Court summarily dismissed the said appeal. Thereafter, the appellant applied
for and obtained a certificate from the High Court and with the said
certificate the present appeal has been brought before us.
Pending these proceedings, the tenant Chetri
died and his heirs and legal representatives Mst. Tulsa Devi and others.
880 have been brought on the record and will
be described as respondents hereafter. Thus, the only point which arises for
our decision is whether the Assam High Court was right in taking the view that
the provisions of s. 5 applied to the proceedings between the parties which
were pending at the relevant time before the lower appellate Court.
Appeal No. 569 of 1963 arises from a suit
filed by the appellant Wahedulla against his tenant, the respondent Abdul
Hamid. The relevant facts are similar to those in C.A. No. 549/1962. In this
case also, the Act came into force while the appeal was pending before the
lower appellate Court and by the application of s. 5 respondent's claim to
continue in possession has been upheld and the appellant's claim for ejecting
the respondent has been rejected. The High Court granted certificate to the
appellant when it was told that the appellant proposed to challenge the
correctness of its earlier decision holding that s. 5 of the Act applied to the
The Act was passed by the Assam Legislature
in order to regulate in certain respects the relationship between landlord and
tenant in respect of non-agricultural lands in the urban areas of the State of
Assam. It contains fourteen sections and the scheme which is evident in the
operative provisions of the Act is to afford protection to the tenants by
regulating in certain respects the relationship between them and their
landlords in respect of the lands covered by the Act. Section 3(c) defines a
'landlord' as meaning a person immediately under whom a tenant holds but does
not include the Government. While s. 3(d) defines a 'Permanent structure' in
relation to any locality as meaning a structure which is regarded as permanent
in that locality, the 'tenant and 'urban area' are defined by clauses (g) and
(b) respectively. Section 4 imposes an obligation on the tenant to pay rent for
his holding at fair and equitable rates, and the proviso prescribes that in
case of any dispute as to fair rent ,between the parties, the rent which was
paid by the tenant immediately before the dispute shall be deemed to be fair
and equitable unless a competent court decides to the -,contrary. Section 6
provides for compensation for improvements; s. 7 provides for enhancement of
rent by contract,.
s. 8 deals with enhancement of rent without
contract; s. 9 881 authorises the Court to make an order as to enhancement of
rent: s. 10 prohibits illegal realisation beyond the prescribed amount; s. 11
provides for notice for ejectment;
s. 12 prescribes the procedure in which the
notice has to be served; and s. 13 confers rule-making power on the State
Government. Section 14 repeals the earlier Tenancy Act.
Having thus broadly considered the scheme of
the Act, it is necessary to read s. 5, the effect of which is the main point of
controversy between the parties before us. Section 5(i) reads thus:Notwithstanding
anything in any contract or in any law for the time being in force-(a) where
under the terms of a contract entered into between a landlord and his tenant
whether before or after the commencement of this Act, a tenant is entitled to
build, and has in pursuance of such terms actually built within the period of
five years from -the date of such contract, a permanent structure on the land
of the tenancy for residential or business purposes, or where a tenant not
being so entitled to build, has actually built any such structure on the land
of the tenancy for any of the purposes aforesaid with the knowledge and
acquiescence of the landlord, the tenant shall not be ejected by the landlord
from the tenancy except on the ground of non-payment of rent; (b) where a
tenant has effected improvements on the land of the tenancy under the terms
whereof he is not entitled to effect such improvements, the tenant shall not
be, ejected by the landlord from the, land of the tenancy unless compensation
for reasonable improvements has been paid to the tenant".
Sub-section (2) prohibits the ejectment of
any tenant from the land of the tenancy except in execution of a decree for
ejectment passed by a competent civil Court; and sub-section (3) prohibits the
execution of a decree for ejectment on the ground of non-payment of rent within
a period of 30 days from the date of the decree, and allows the tenant to pay
into the executing Court the entire amount due from him under 134-159 S.C.-56
882 the decree within the said period, Whereupon the decree has to be entered
Mr. Chatterjee contends that the Assam High
Court was in error in coming to the conclusion that the proceedings which were
pending between the parties at the appellate stage on 6th July, 1955 when the
Act came into force, fell to be governed by the provisions of s. 5. He argues
that at the relevant date when the suit was filed by the appellant, he had
acquired a right to eject the tenant under the terms of the tenancy, and he
contends that where vested rights are affected by any statutory provision, the
said provision should normally be construed to be prospective in operation and
not retrospective, unless the provision in question relates merely to a procedural
matter. It is not disputed by him that the legislature is competent to take
away vested rights by means of retrospective legislation. Similarly, the
legislature is undoubtedly competent to make laws which over-ride and
materially affect the terms of contracts between the parties; but the argument
is that unless a clear and unambiguous intention is indicated by the
legislature by adopting suitable express words in that behalf, no provision of
a statute should be given retroactive operation if by such operation vested
rights are likely to be affected.
These principles are 'unexceptionable and as
a matter of law, no objection can be taken to them. Mr. Chatterjee has relied
upon the well known observations made by Wright J. in re Athlumney Ex parte
Wilson(1), when the learned Judge said that it is a general rule that when the
Legislature alters the rights of parties by taking away or conferring any right
of action, its enactments, unless in express terms they apply to pending
actions, do not affect them. He added that there was one exception to that
rule, namely, that, where enactments merely affect procedure and do not extend
to rights of action, they have been held to apply to existing rights. In order
to make the statement of the law relating to the relevant rule of construction
which has to be adopted in dealing with the effect of statutory provisions in
this connection, we ought to add that retroactive operation of a statutory
provision can be inferred even in cases where such retroactive operation appears
to be clearly implicit in the (1)  2 Q. B. D. 547.
883 provision construed in the context where
it occurs. In other words, a statutory provision is held to be retroactive
either when it is so declared by express terms, or the intention to make it
retroactive clearly follows from the relevant words and the context in which
Bearing in mind these principles, let us look
at s. S. Before doing so, it is necessary to consider s. 2 which provides that
notwithstanding anything contained in any contract or in any law for the time
being in force, the provisions of this Act shall apply to all non-agricultural
tenancies whether created before or after the date on which this Act comes into
force. This provision clearly indicates that the legislature wanted the
beneficent provisions enacted by it to take within their protection not only
leases executed after the Act came into force, but also leases executed prior
to the operation of the Act. In other words, leases which bad been created
before the Act applied are intended to receive the benefit of the provisions of
the Act, and in that sense, the Act clearly affects vested rights of the
landlords who had let out their urban properties to the tenants prior to the
date of the Act.
That is one important fact which is material
in determining the scope and effect of s. 5.
Now, s. 5 itself gives an unmistakable
indication of the legislative intention to make its provisions retrospective.
What does s. 5 provide? It provides
protection to the tenants who have actually built within five years from the
date of leases executed in their favour, permanent structures on the land let
out to them for residential or business purposes, and this protection is
available either when the construction of the permanent structure has been made
by the tenant in pursuance of the terms of the lease, or even without any term
of that kind and the landlord had knowledge of it and had acquiesced in it.
Thus, the plain object of s. 5 is to protect the tenants who have built a permanent
structure either for business or for residence, provided it has been built
within 5 years from the date of contract of tenancy. Therefore, cases where
permanent structures had been built within 5 years of the terms of contract,
would fall within s. 5 ( 1 ) (a), even though those constructions had been made
before the date of the Act. Thus, the very scheme of 5 (1) (a) clearly
postulates the extension of its protection to 884 constructions already made.
That is another point which is significant in dealing with the controversy
between the parties before us.
There is yet another point which is relevant
in this connection. S. 5(1)(a) provides that the tenant shall not be evicted by
the landlord from the tenancy except on the ground of non-payment of rent,
provided, of course, the conditions prescribed by it are satisfied. If the
legislature had intended that this protection should operate prospectively. it
would have been easy to say that the tenant shall not be sued in ejectment;
such an expression would have indicated that the protection is afforded to the
suits brought after the Act came into force, and that might have introduced the
element of prospective operation;
instead, what is prohibited by s. 5 (1)(a) is
the eviction of the tenant, and so, inevitably, the section must come into play
for the protection of the tenant even at the appellate stage when it is clear
that by the proceedings pending before the appellate court, the landlord is
seeking to evict the tenant, and that obviously indicates that the pending
proceedings are governed by s. 5(1)(a), though they may have been initially
instituted before the Act came into force.
Incidentally, an appeal pending before the
lower appellate court is a continuation of the suit, and so, there is no difficulty
in holding that a suit which was pending when the Act came into force would be
governed by s. 5(1)(a) and an appeal arising from a suit which had been decided
before the Act came into force, would likewise be governed by s. 5(1)(a),
provided it is pending after the date when the Act came into force. Therefore,
we are satisfied that the Assam High Court was right in coming to the
conclusion that the dispute between the parties in the present case must be
governed by the provisions of s. 5(1)(a). It is common ground that if s.
5(1)(a) is held to apply, the decrees passed against the appellants in both the
appeals cannot be successfully challenged.
The result is, the appeals fail and are
dismissed with costs. One set of hearing foes.